How to Bid in Real Estate Auctions

With the crash of the housing market, real estate auctions have become a major part of the economy. Whether you are a business looking at investing in property or an individual looking to find that great deal on real estate you can often find a great deal if you know how to bid in real estate auctions. Not everything that looks great is what it seems. So here are some pointers on how to bid on property in real estate auctions.

Difficulty: Moderately Easy

Instructions

1. The first step to bid in real estate auctions is to get lists of what's selling. There is a science to bidding on auction property. Limited information is given at the auction and not all properties even make it to the auction block. So the first thing you need to do is acquire a list of all the properties coming up for auction in the area you want.

2. Then take the time to go see the real estate properties. You will not know what you are buying if you don’t check it out first. And that great deal you got at the auction may end up a condemned property with severe structural faults you won’t know about unless you’ve already driven out there to look at it!

3. Go the extra mile -- literally. Know that many of the properties you will need to see may not even come up onto the auction block. So there WILL be an investment of time to see enough properties to give you a selection of similar properties to bid on in a real estate auction. If there is only one property you want, not only might it not come up for auction on the day you plan to attend, but be prepared that the bidding may exceed what you want to spend – or even the value of the property itself if bidding becomes heated.

4. Next check the prices of comparable properties. You will want to be armed with the knowledge of the true value of the property on which you are bidding. In most cases, the starting bid will not even be announced until shortly before bidding begins.

5. Know your limits and be willing to let go if the bid goes higher than you want to pay.
   In a real estate auction it is easy to get involved with the emotionalism of winning and lose sight of getting the bargain you want.

6. Bring cash. The whole point of buying and selling at an auction is that you will be paying cash for the property. Later you can sell the property to someone who is aided with financing, but auctions are all about cash.

7. There are many intricacies to learn about how to bid in real estate auctions, especially if you intend to do this as a business. These tips should be helpful to get you started.

[whiteshoulder]

on 11/12/2009 Very well done and informative.